Do I need a lawyer to deal with the IRS?
May 26, 2020 10:33 PM EDT
The British dramatist Christopher Bullock once wrote, "'Tis impossible to be sure of anything but Death and Taxes." Whether you are being audited, having your wages garnished, or trying to set up a business, dealing with the IRS can be frustrating and intimidating. The assistance of a trained attorney can help quite a bit and maybe a necessity in some cases.
Why a Tax Attorney is Better Than an Accountant
It may be your first inclination to visit an accountant when you have a tax problem. However, you should know that a trained and licensed tax attorney can handle issues that an accountant cannot. When you look for an attorney, be sure to ask about their educational background. In addition to their JD, they should have an undergrad or master's degree in tax law.
Tax attorneys generally do not prepare taxes for people or businesses, but instead, help them deal with specific tax problems. There are a few typical situations in which a person might need a tax attorney.
If you owe money on back taxes, it is always advisable to contact the IRS, so you can make a payment arrangement with them. If you ignore notifications, the government has the right to garnish your wages and put a lien on any property you may owe. Your paycheck can be garnished for up to 25% of your wages in the state of Washington.
If you owe over $10,000 to the IRS, it is important to hire a tax attorney who can negotiate with tax collectors on your behalf. It is also helpful if you select an Everett bankruptcy lawyer, as there are some limited circumstances in which tax debts can be excused by bankruptcy.
The IRS can foreclose on your home if you do not make an arrangement to take care of your debt. You can even go to jail if you do not pay your taxes, so legal representation is critical.
If you want to make sure that you will have money after you retire and that your family members are provided for after you have passed, a tax attorney can help you with estate planning.
An estate plan is different from a will in that it minimizes the amount of taxes your heirs will have to pay on their inheritance. It can also specify how your medical bills will be paid if you are ever incapacitated.
A tax attorney can help you set up trusts for any children to whom you may want to leave money. They can also help you set up foundations that will support charities and help to protect your assets from being overtaxed.
Setting Up a Business
If you are starting a business, it is important to consult with a tax attorney so you can decide how you want to incorporate your company. A tax attorney can help you figure out if you want to register yourself as a DBA or if you want to create a Limited Liability Company or a corporation.
There are many websites on the internet that will claim they can tell you how to deal with the IRS without an attorney. However, the government has more power than ordinary creditors.
Whether you already owe the government money or you want to avoid owing them money in the future, a tax attorney can help.